In the age of entrepreneurship and side hustles, many of us have transformed our homes from a place for people to love into a place for a business to live. From Facebook Marketplace to a fruit stand, earning extra cash has never been easier. However, this combination of home and business comes with a set of insurance challenges that many homeowners are unaware of.
What Are The Risks Of Selling From Your Home?
Selling goods from your home, whether flipping furniture or selling your organic produce from your home garden, introduces risks beyond the usual home insurance scope. These activities can attract more visitors to your property, increasing the likelihood of liability claims, such as someone tripping and getting injured. Additionally, there’s a risk to your inventory – when there is intent to sell those dozen eggs or hand-restored chairs are your income, and their loss isn’t just personal; it’s financial.
Why Isn’t Everything Covered By My Home Insurance?
The primary reason your standard home insurance may not cover your home-based business activities is straightforward: a business isn’t just a home. Home insurance policies are designed to protect your personal property and liability as a homeowner, not the risks associated with business operations, which can vary greatly in scope and nature. Below we have broken down a few types of home businesses in more detail:
1. Facebook Marketplace Ongoing Sales
Regular sales on platforms like Facebook Marketplace can be considered a business activity. If you’re continuously selling items as a form of income, this goes beyond the occasional online garage sale and enters the realm of business, which needs to be insured differently
2. Selling Eggs Isn’t Covered By Your Insurance
If you’ve turned your backyard coop into a small egg-selling enterprise, with a high volume of sales. This is another example where personal insurance might fall short. The sale of goods produced at home, especially regularly, typically requires additional coverage.
3. The Hidden Risk Of Having A Fruit Stand
Operating a fruit stand, even seasonally, introduces liability risks. One of the biggest of these is a customer getting injured on your property. That would not be covered under a standard homeowner’s policy.
4. Furniture Flipping Can Cost You
We all have seen videos on social media of people transforming old furniture into saleable pieces. What many of these content creators may not know is they are not covered by their home coverage. It may be just a fun hobby, but if it is a recurring source of income, it’s considered a business activity. The materials, tools, and finished products associated with this venture would need separate coverage
What Is Covered By My Home Insurance?
A normal home insurance policy protects your physical home, and personal belongings, and offers liability protection for incidents that aren’t business-related. For instance, if a neighbor brings you a flower basket and slips on your porch, that’s a personal liability covered by your home insurance. However, if that same neighbor comes to pick up a piece of furniture they bought from your latest flip and tweaks their back lifting it, this is no longer covered under that same policy.
What Home Sales Are Protected By My Home Insurance?
It’s essential to differentiate between occasional, personal sales and ongoing business activities. Your home insurance might cover the occasional sale of an item on Facebook Marketplace, a garage sale, or a neighbor paying you for your extra eggs. These are infrequent and not considered business operations. In contrast, regular sales, like weekly egg distribution, a daily fruit stand, or buying used goods for weekly garage sales, are considered business activities and fall outside the typical home insurance coverage.
Contact Strickler Insurance For Small Business Insurance
This can be challenging but there are ways to know if you need more than homeowners insurance. At Strickler Insurance, we understand the challenges and risks you are faced with when combining your living space with your business. Our team can help provide customized insurance solutions that protect both your home and your business. Contact Strickler Insurance to ensure your hard work is safeguarded with the right coverage.
